Aerospace and defense company Howmet (NYSE:HWM) reported Q2 CY2026 results beating Wall Street’s revenue expectations, with sales up 24.1% year on year to $2.55 billion. On top of that, next quarter’s revenue guidance ($2.58 billion at the midpoint) was surprisingly good and 4.1% above what analysts were expecting. Its non-GAAP profit of $1.33 per share was 6.7% above analysts’ consensus estimates.
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Howmet (HWM) Q2 CY2026 Highlights:
- Revenue: $2.55 billion vs analyst estimates of $2.43 billion (24.1% year-on-year growth, 4.9% beat)
- Adjusted EPS: $1.33 vs analyst estimates of $1.25 (6.7% beat)
- Adjusted EBITDA: $817 million vs analyst estimates of $773 million (32.1% margin, 5.7% beat)
- The company lifted its revenue guidance for the full year to $10.05 billion at the midpoint from $9.65 billion, a 4.1% increase
- Management raised its full-year Adjusted EPS guidance to $5.27 at the midpoint, a 6.7% increase
- EBITDA guidance for the full year is $3.23 billion at the midpoint, above analyst estimates of $3.12 billion
- Operating Margin: 27.9%, up from 25.4% in the same quarter last year
- Free Cash Flow Margin: 18.8%, up from 16.8% in the same quarter last year
- Market Capitalization: $116.6 billion
Company Overview
Inventing the first forged aluminum truck wheel, Howmet (NYSE:HWM) specializes in lightweight metals engineering and manufacturing multi-material components used in vehicles.
Revenue Growth
Examining a company’s long-term performance can provide clues about its quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Luckily, Howmet’s sales grew at an exceptional 13.8% compounded annual growth rate over the last five years. Its growth surpassed the average industrials company and shows its offerings resonate with customers, a great starting point for our analysis.
We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Howmet’s annualized revenue growth of 13.4% over the last two years aligns with its five-year trend, suggesting its demand was predictably strong. 
We can better understand the company’s revenue dynamics by analyzing its most important segments, Engine products and Fastening systems, which are 53.8% and 12.4% of revenue. Over the last two years, Howmet’s Engine products revenue (aircraft engines, industrial turbines) averaged 18.8% year-on-year growth while its Fastening systems revenue (connector products and tools) averaged 6% growth. 
This quarter, Howmet reported robust year-on-year revenue growth of 24.1%, and its $2.55 billion of revenue topped Wall Street estimates by 4.9%. Company management is currently guiding for a 23.3% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 14.6% over the next 12 months, similar to its two-year rate. This projection is admirable and implies its newer products and services will fuel better top-line performance.
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Operating Margin
Howmet has been a well-oiled machine over the last five years. It demonstrated elite profitability for an industrials business, boasting an average operating margin of 21.5%.
Analyzing the trend in its profitability, Howmet’s operating margin rose by 11.8 percentage points over the last five years, as its sales growth gave it immense operating leverage.
In Q2, Howmet generated an operating margin profit margin of 27.9%, up 2.5 percentage points year on year. This increase was a welcome development and shows it was more efficient.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth — for example, a company could inflate its sales through excessive spending on advertising and promotions.
Howmet’s EPS grew at 46.3% compounded annual growth rate over the last five years, higher than its 13.8% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
Diving into Howmet’s quality of earnings can give us a better understanding of its performance. As we mentioned earlier, Howmet’s operating margin expanded by 11.8 percentage points over the last five years. On top of that, its share count shrank by 8%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. 
Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.
For Howmet, its two-year annual EPS growth of 42.8% was lower than its five-year trend. We still think its growth was good and hope it can accelerate in the future.
In Q2, Howmet reported adjusted EPS of $1.33, up from $0.91 in the same quarter last year. This print beat analysts’ estimates by 6.7%. Over the next 12 months, Wall Street expects Howmet’s full-year EPS to grow 21.7% from $4.55 to $5.54.
Key Takeaways from Howmet’s Q2 Results
This was a beat and raise quarter. We were impressed by how significantly Howmet blew past analysts’ revenue expectations this quarter. We were also glad its full-year EBITDA guidance trumped Wall Street’s estimates. Zooming out, we think this was a solid print. The stock traded up 2.5% to $298.93 immediately following the results.
Howmet may have had a good quarter, but does that mean you should invest right now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).